---
title: "Markup vs. margin | Drywall Glossary"
url: https://tapeandfloat.com/glossary/markup-vs-margin.html
language: en
author: James Grokman, CEO, TapeAndFloat
updated: 2026-10-29
---

# Markup vs. margin

**Markup is the profit you add, measured as a percent of your job cost. Margin is the same profit measured as a percent of your bid price. Because the price is bigger than the cost, the same profit dollars always give a smaller margin than markup.**

## Why it matters on a drywall job

- Mixing the two up can leave a bid short of the profit you meant to build in.
- A GC, a lender or your bookkeeper may talk in margin while you price in markup. Check which one they mean before you compare numbers.
- Overhead has to be covered somewhere. Decide whether it sits in your job cost or comes out of the markup, and stay consistent from bid to bid.

## The math, in plain words

- **Profit** = bid price − job cost.
- **Markup** = profit ÷ job cost × 100.
- **Margin** = profit ÷ bid price × 100.
- **Price from a markup** = job cost × (1 + markup ÷ 100).
- **Price from a target margin** = job cost ÷ (1 − margin ÷ 100).

> **EXAMPLE only (made-up numbers, not a suggested markup or margin):** job cost $10,000 (EXAMPLE), bid price $12,500 (EXAMPLE). Profit = $12,500 − $10,000 = $2,500. Markup = $2,500 ÷ $10,000 = 25%. Margin = $2,500 ÷ $12,500 = 20%. Same job, same profit dollars, two different percents.

Run your own numbers with the [free markup vs margin calculator](https://tapeandfloat.com/markup-margin-calculator.html). Nothing is pre-filled and nothing you type leaves your browser.

## Frequently asked questions

### Is a 20% markup the same as a 20% margin?

No. A 20% markup on cost works out to a margin of about 16.7% on price. To reach a 20% margin you need a 25% markup on cost.

### Which one should I use to price a bid?

Either works if you do the math right. Many contractors price from cost with a markup and check the margin before they send the bid. What matters is knowing which one you are looking at.

### Can margin be 100% or more?

No. Margin is a share of the price, so it has to stay under 100%. Markup has no such cap, because it is measured on cost.

## Related guides and tools

- [Free markup vs margin calculator](https://tapeandfloat.com/markup-margin-calculator.html)
- [Overhead and profit (O&P)](https://tapeandfloat.com/glossary/overhead-and-profit.html)
- [Job costing](https://tapeandfloat.com/glossary/job-costing.html)
- [How to bid drywall](https://tapeandfloat.com/guides/how-to-bid-drywall.html)
- [Drywall bid sheet template](https://tapeandfloat.com/templates/drywall-bid-sheet-template.html)
- [All glossary terms](https://tapeandfloat.com/glossary/)

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_¿Prefiere español? [Sobreprecio (markup) vs. margen](https://tapeandfloat.com/es/glosario/sobreprecio-vs-margen.html)._